Michael Lebby officially announced that a significant deal is not clearly imminent so as a result guidance for such a deal is being pushed out to 2025. The stock price tanked about 20% yesterday on high volume. No one was happy, myself included, except for those who make their money when stock prices go down. More downward pressure is likely in the coming days, so do you stay or do you go?
Doing an inventory on why you are here is necessary in times like these. If you are an investor with a long term view you can count the reasons to hold or even add based on many things such as:
PICs with Perkinamine has all being asked by data center customers ie speed, power reduction, size, low cost without a driver, stability, low optical loss, proof of foundry compatibility on standard equipment, ability to scale on 200mm equipment, superior packaging with with ALD, strong potential for upgrades to Perkinamine for future design needs
AI demand is accelerating upgrades including transceivers. GPUs get the buzz but soon decisions on transceiver upgrades becomes important. There are multiple options but LWLG polymers show the best specs. There is a hyper scaler race to build faster, lower power centers. It is a matter of competition for customers at the same time avoiding public and government pressure to keep energy use much lower. LWLG polymers have be demonstrated at 0.5 volt and Dr. Lebby said today they can go even below that number.
Dr. Lebby has been wrong with goals on a Tier 1 deal this year. Some say he is lying, some say he is not up to the task. We do not know details of how the contract negotiations are going. Today's investor talk on Benzinga he said they are in deep relations with Tier ones and several transceiver makers working on deals. These companies are in N. America, Europe and Asia so quite extensive interest suggesting the possibility of a very significant ramp in 2025 when deals happen. What is the hold up? Possibilities include contract language and lawyering back and forth, getting to the final numbers in the contract that both sides can agree on, waiting on testing of transceiver prototypes or customer acceptance of such, or final decisions on data center customers on when and the extent of uptake of polymer fueled transceivers. Data centers have to plan how, where and how fast they will proceed with upgrades and that can take time. Uncertainties that hyper scalers and customers still have can delay a final agreement and this is not under Michael Lebby's control.
Don't forget the industry confidence and appreciation of the company's progress with it winning the Best Hybrid Platform Integration Award two years running. I like confirmation on what I understand.
I am an investor not a trader so I will continue to hold my position as the technology has developed overall to my great satisfaction. It is not a matter of if LWLG polymers will be taken up but a matter of when.
I would like to see a mentor for Michael Lebby in the CEO role. Thomas Connelly Jr. would fit the role perfectly down the line as he is an expert on materials including polymers and has the contacts with large corporations that would be useful in aiding the company's commercial development.
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